Cruz Miguel Aguina Morales, et al. v. Redco Transport, Ltd., et al., 2015 WL 9274068 (S.D. Tex. 2015)
On a number of occasions, courts have held the Federal Aviation Administration Authorization Act (FAAAA) preempts state and common law tort claims against freight brokers given that motor carrier services would be affected. However, FAAAA specifically doesn’t restrict a state’s regulation of motor vehicle safety. In this case, freight broker Samsung SDS America (SDSA) booked a load with motor carrier JIT Automation, whose truck was involved in an accident which tragically resulted in personal injuries and a death of other motorists. The latter sued SDSA and JIT in the U.S. District Court for the Southern District of Texas, alleging SDSA negligently selected JIT. SDSA moved to dismiss the claims based on FAAAA preemption.
FAAAA’s safety exemption sees little judicial attention, and apparently none as regards brokers. SDSA argued that safety regulation cases exempting motor carriers from FAAAA’s preemption didn’t apply to a broker because brokers never hold care, custody and control over cargo, and never operate motor vehicles. In other words, safety regulation, while remaining within state dominion, can’t implicate a cargo middleman.
The court disagreed. Possession of cargo and operation of trucks aren’t essential elements of a safety negligence claim. Thus, FAAAA preemption doesn’t apply to the plaintiffs’ allegations relating to safety. SDSA’s motion to dismiss was denied.
Bracey, Jr., et al. v. McDonald, et al., 2016 WL 266059 (Ct.Apps. Tenn. 2016)
A motorist injured in an accident sued trucker Conrad Transportation and its driver Otis McDonald in Tennessee. A year or so later, after the statute of limitations had expired, he amended his complaint to name as defendants a series of logistics service providers, claiming they were “… engaged in a joint venture and an agreement among them to participate in a common enterprise for the purpose of commercially transporting freight …” The new defendants moved to dismiss the amended complaint as time barred. The trial court agreed, and the plaintiff took the matter to the Volunteer State’s court of appeals.
He didn’t fare better there, the court rejecting his argument that the new claims “relate back” to the old ones, and therefore should be deemed timely filed against the new defendants (as provided by state statute). To qualify, the plaintiff would have to demonstrate that the new claims arose out of the same occurrence originally alleged, and that the new parties had notice both of the timely claim and of a mere mistake in their not being named in the first place.
Despite notations on bills of lading, the court couldn’t agree that the new defendants had notice of the lawsuit, or that it was intended to be against them. The original allegations were cast in terms of negligence and master servant liability, suggesting nothing about other entities’ involvement. The new claims are time barred.
AXA Corporate Solutions Assurance, et al. v. Great American Lines, Inc., et al., 2015 WL 9460558 (D. NJ 2015)
In circumstances involving multiple service providers which provide similar but differing roles, different liability parameters and analyses can apply to the players in the same cargo claim. That’s what happened when shipper Sanofi-Aventis booked transit with motor carrier Great American Lines (GAL) of some $59 million worth of pharmaceuticals from its Georgia facility to its distributor, McKesson Corp., in Tennessee. Also involved were MVP Leasing, from which GAL had leased trucks, and Pilot Travel Centers, which operated the facility where the cargo was stolen. After paying up on a policy, McKesson’s subrogated insurer, AXA, sued all concerned in the U.S. District Court for the District of New Jersey.
AXA alleged the defendants were liable based on Carmack; that GAL and MVP were liable based on breach of contract and breach of an implied contract of bailment theories; and Pilot was liable based on a negligence theory. All parties moved for summary judgment. GAL indisputably was a motor carrier subject to Carmack preemption of state and common law theories of liability. MVP urged it was not one, pointing out that it assigned its driver to work for GAL under GAL’s authority. However, as MVP owned the truck and paid the driver, a question of fact precluding summary judgment remained as to its motor carrier status.
Sanofi had entered into a transportation contract with GAL which waived the plaintiff’s rights under Carmack. MVP and Pilot argued that contract applied to them as well, pointing out that their services were part of GAL’s, and the law doesn’t require a separate contract from each one of several related service providers. But this contract specifically limited its applicability to the signatories, such that MVP and Pilot couldn’t piggyback their way in. Carmack at least potentially could apply to them.
The court found questions of fact as to the substance of AXA’s Carmack allegations, precluding summary judgment on that issue, although the court dismissed the common law claims against GAL as preempted. The court addressed those common law claims against MVP (which only would apply if it demonstrates it’s not a motor carrier), and dismissed them as a matter of law. As the tractor and trailer were in GAL’s exclusive possession as a matter of federal law, there could be no bailment. Apparently, AXA didn’t oppose in its briefing MVP’s motion to dismiss the contract claim, so it got thrown out as well. Similarly, AXA offered no evidence supporting the causation element of a negligence claim against Pilot, such that this theory was tossed as well.
Great West Casualty Co. v. National Casualty Co., 807 F.3d 952 (8th Cir. 2015)
Owner operator Heinis was under lease to motor carrier Avery Enterprises. Both had their own insurance coverage, with Great West insuring Heinis and National Casualty insuring Avery. Heinis was responsible under his lease for repairs to his rig, and got them handled in Avery’s garage. When he brought in his rig to have a leak fixed, it exploded, injuring a mechanic. The mechanic sued Heinis and Avery, and both tendered the claim to their respective insurers. The insurers duked it out in a coverage battle, first in the U.S. District Court for North Dakota, and then in the Eighth Circuit. Both courts agreed National had to provide coverage.
National’s policy to Avery clearly made Heinis’s truck a “covered vehicle,” but did so only when “connected” to a trailer. National thought “connected” meant “hitched,” i.e., physically connected and either in or ready for trucking operations. Great West, and ultimately the courts, disagreed. The term wasn’t defined in the policy, and the Webster’s definition, which applied in the absence of a policy definition, included “having the parts or elements logically related.” In other words, because Heinis’s rig was associated with a particular Avery trailer, a fair understanding of the term included a tractor that Avery had assigned a trailer. National’s policy had some exclusions the courts found inapplicable, such as employer liability and “fellow employee,” because Heinis, an owner operator, wasn’t an Avery employee as a matter of FMCSA regs.
Great West’s policy excluded coverage for a truck in the use, or business, of another entity. National argued that the rig, while being repaired, wasn’t in its “use,” such that the exclusion didn’t apply. The courts rejected that argument as well, as Heinis’s lease required him to maintain his vehicle, and he was only complying with that term at the time of the accident. A truck needn’t be on a highway to be in “use.” National gets to defend and potentially pay the mechanic’s claim.
Jackson v. International Paper Company, et al., 2015 WL 9274981 (N.D. Ind. 2015)
Driver Jackson fetched a sealed trailer containing paper rolls from International Paper. As he went around a ramp, the trailer rolled over causing him injuries. He sued International Paper pro se in Indiana state court, claiming the shipper improperly loaded the cargo without blocking and bracing in violation of state and federal law. International Paper removed the action to the U.S. District Court for the Northern District of Indiana, and retained a cargo loading expert. Apparently Jackson tried to get an expert to give counter-testimony, but procedural errors resulted in exclusion of his expert.
International Paper moved for summary judgment, and presented its expert’s statements about cargo loading and movement dynamics. He concluded that the acceleration needed to move the cargo would only be achieved after the trailer had already begun to roll. The testimony summary presents an interesting glimpse at how an expert analyzes a rollover case, and how such expert testimony can be applied. Absent evidence to the contrary, Jackson’s claims were dismissed, the court adding that Jackson’s case would fail even without International Paper’s expert statement because there was no evidence about how the cargo was loaded and secured. The mere fact of a rollover isn’t sufficient to get a claim to a jury.
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